Calculate compensation fees
Is housing and transportation allowance included in calculating compensation wages?
Yes, housing allowance and transportation allowance are included in calculating compensation pay for unfair dismissal.
According to Article 2 of the Saudi Labor Law, the term “wage” wherever it appears in the law (including Article 77 on compensation) means the actual wage.
The law defined the actual wage as:
“The basic wage plus all other due increases that are determined for the worker in return for the effort he expended at work, or risks to which he is exposed in performing his work, or that are determined for the worker in return for work under the employment contract or the work organization regulations.”
Among these increases included in the actual wage:
- Fixed allowances such as (housing allowance and transportation allowance).
- Increases granted to meet family burdens or standard of living.
- Commissions, grants and bonuses that are normally paid until they become part of the wage.
Therefore, compensation for unfair dismissal is calculated based on your total last salary including basic wage and all fixed allowances, and not just basic wage.
Calculate compensation fees
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